English to ease crisis spending

Finance Minister Bill English says the Government will soon start reining in spending aimed at stimulating the economy.

Speaking after a meeting of Apec finance ministers in Singapore yesterday, Mr English said New Zealand could afford to pull back on stimulus spending now that the worst of the worldwide financial crisis was over.

Asia-Pacific finance and trade ministers urged countries yesterday to slow stimulus spending, ensure stable growth and strengthen financial systems for a thriving, prosperous global economy in the post-crisis period.

Mr English said New Zealand was gradually withdrawing stimulus and new spending in 2010.

"We are pulling back from pumping money in," he said. "The concern is that the United States needs to keep stimulating their economy because it's in a pretty bad shape. We are in a better shape, we can afford to pull back and get a more balanced recovery so that the private sector can get up and running, providing new jobs."

Mr English said the impact of the weak US economy has been cushioned by robust Asian economies, especially China. "We are on the road to recovery but there are going to be a few bumps along the road."

Restoring growth potential, withdrawing stimulus packages and meeting the region's massive infrastructure needs are the main challenges facing the world economy after the crisis subsides, a joint statement from the finance ministers said. It also called for freer trade and warned against resorting to protectionism.

- AP